The Cheesecake Factory (CAKE)

Days of sales outstanding (DSO)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Receivables turnover		166.40	153.48	80.93	53.74	82.07
DSO	days	2.19	2.38	4.51	6.79	4.45

December 31, 2023 calculation

DSO = 365 ÷ Receivables turnover
= 365 ÷ 166.40
= 2.19

The Days of Sales Outstanding (DSO) metric for The Cheesecake Factory indicates the average number of days it takes for the company to collect payments from its customers after making a sale. Looking at the trend over the past five years, we observe a decreasing trend in DSO, reflecting an improvement in the company's ability to efficiently collect payments.

In 2023, The Cheesecake Factory's DSO stood at 2.19 days, demonstrating a further reduction from the previous year's 2.38 days. This signifies that the company has enhanced its collections process, possibly by implementing more effective credit control measures or streamlining its invoicing procedures.

Comparing to the DSO figures from 2021 and 2020, where the values were significantly higher at 4.51 days and 6.79 days, respectively, the current DSO of 2.19 days is evidence of the company's efforts to minimize the time taken to receive payments, thereby potentially improving cash flow and liquidity.

Additionally, the 2019 DSO of 4.45 days falls between the more recent years, indicating some variability in the collection period during that period.

Overall, the decreasing trend in DSO for The Cheesecake Factory suggests a positive development in its receivables management efficiency, indicating timely collection of revenues and potentially better working capital management.